Financial News 01/31/2012

• Business Insider: Over 1000 millionaires to be created by Facebook IPO 
• USA Today: Early tax filings delayed by security measures
• ET: Occupy D.C. protestors resist police notice to disband
• Fox: Opposition leader says U.S. debt will soon look like Greece
• Reuters: World will need 50% more food by 2030
• BBC: Eurozone's unemployment rate hit 10.4% in 12/2011
• EU Concil: Euro treaty restricts budget deficits to .5% of GDP

Financial News 01/30/2012

• Daily Finance: Middle age workers increase school enrollment 
• Fed: Consumer credit on the rise despite smaller increase in savings rate
• CNBC: Chinese 5 year credit-default swaps yield near 19.34%
• BEA: Consumer spending increased less that .1% in December 2011
• Barron's: U.S. Money Market Funds reducing exposure to European debt 
• CBS: Occupy protest turns violent in Oakland, California
• U.S. News: Personal finance education on the rise in high schools
• Fitch: 6 Eurozone nations credit ratings have been downgraded
• Digital Journal: Greece stands firm on German bid for budgetary control

America's Wealthiest Presidents

 Image attribution:  BrokenSegue, WikiCommons. US-PDGov.

The United States has had quite a few multimillionaires for Presidents. Of the five wealthiest U.S. presidents in history George Washington was the wealthiest with a peak fortune worth near half a billion in current dollars.

Complete article link: http://www.helium.com/items/2284935-the-richest-us-presidents-in-history

The Wealthiest Presidents The World Has Seen

 Image attribution: Russian Kremlin: Presidential Press and Information Office. CC BY-SA 3.0

The World has seen some very wealth presidents indeed, some of which have been far wealthier than any U.S. President. Presidents tend to under-perform quite a few monarchs and other royalty, and although other heads of state have been or are as wealthy as the richest presidents, they are technically not presidents either in title, job function. The presidents below are among the richest presidents of all time.

1. Vladmir Putin, Russia. $40 billion
   
The wealthiest president of all time is Vladmir Putin. His worth was claimed to be $40 billion by the Telegraph, and also puts him among the richest people in the World. Since Warren Buffett is the World's third richest man with a worth of $39 billion per Forbes, that would make Vladmir Putin the third wealthiest person in the world when heads of state are included in that list.  

2. Khalifa bin Zayed Al Nahyan, U.A.E. $23 billion

According to the CIA World Fact Book, the President of the United Arab Emirates is elected by the legislative branch of government with five year terms. President Khalifa bin Zayed Al Nahyan is worth $23 billion according to Luxist. Much of his wealth is derived from Sheikdhom legacy rights in Abu Dhabi, the U.A.E.'s largest oil rich emirate and home to the richest city in the world per CNN Money.

3. Sebastian Pinera, Chile. $2.4 billion

Chile's President Sebastian Pinera is worth $2.4 billion, and is among the top 10 heads of state  according to Business Pundit. President Pinera made his wealth via business leverage obtained via Chilean representation rights per the Chilean government. Furthermore, also per Business Pundit, a large portion of this president's wealth was attained via investing in the Chiliean Lan Airline.

4. Asif Ali Zaradi, Pakistan. $1.8 billion

Asif Ali Zaradi hails from Pakistan and was elected President via the electoral process of Pakistan in 2008. Asif Ali Zaradi was a wealth land-owner, and was married to the late Benazir Bhutto, a wealthy politician who was assassinated. This president is the second wealthiest person in Pakistan, and is worth $1.8 billion  per The Richest People.

5. George Washington, U.S.A., $512 million

If dictators such as Egypt's ex President Hosni Mubarak, and other quasi-presidents are excluded, George Washington makes it on to the list of the World's five richest presidents in time immemorial. George Washington was also the first President in the World according to Vision Radio Productions. George Washington had a combination of good fortune, business skills, and career success to obtain his wealth.

Financial News 01/27/2012

• AP: Carnival Cruise subsidiary offers $14,460 per sunken ship victim
• BEA: 2011 Q4 GDP advance reading is 2.8%, about 1.56% for all 2011
• Reuters: 100,000 army workers to lose jobs in 2013
• Options Queen: Dividend stocks good until Bush policy ends
• Telegraph: UK burial grounds a rocketing investment
• Bloomberg: Greek 10-year bond yields reach 33.64%
• WP: Asian Development Bank predicts 7% growth in Asian economies

Financial News 01/26/2012

• Reuters: Oil prices could rise 30% on Iranian counter embargo

• DOL: 377,000 jobless claims were filed the week ending 01/21/2012
• CNBC: Greenspan doubtful of wisdom in economic improvements
• Fed: Fed announces extension of low lending rates to 2014
• Bloomberg: Treasury Secretary expects no second term
• MW: New cost-basis disclosure transition could complicate tax filings
• UK Guardian: Greek debt deal teeter totters, contagion spreads to Portugal
• BW & RT: Soros buys Italian debt but maintains gloomy outlook

Financial News 01/25/2012

• Reuters: Obama advocates 30% Buffett rule for millionaires
• Fed: FOMC to make policy statements today
• WSJ: Q4 2011 Business earnings send mixed economic message
• Bloomberg: Philadelphia to lose $575 million via financial transactions
• UK Guardian: German Chancellor doubts success of Greek bailout
• Telegraph: UK economy shrank .2% in Q4 2011
• IMF: Downward revision of global economy echoes World Bank

Why China Is Not Excessively Dependent on Exports to the U.S.

Image attribution: lecs. C.C. By-S.A. 3.0

China exports alot of goods to the United States, but what is less known is that the United States has increased its exports to China by $72.7 billion between 2001-2010. Based on U.S. imports of Chinese products as a percentage of the Chinese economy, it does not appear as though China is much more than five percent reliant on the United States, and not the 176% reported by Forbes.

Complete article link: http://www.helium.com/items/2283977-us-trade-relations-with-china

Financial News 01/24/2012

U.S. Federal Spending Allocations Per Year

 

Image source: Gene Simmons. C.C. By-S.A 3.0

• EPA: 2012 Mitsubishi i-MiEV most efficient car, gets 112 combined mpg
• FDIC: 92 banks closed and failed in 2011
• Treasury: Treasury to sponsor school financial capability challenge in May
• Reuters: Eurozone officials rejected private Greek bond holders
• Telegraph: UK government debt passes £1 trillion, near 64% of its GDP
• Bloomberg: India easing monetary policy via lower reserve requirements
• MW: Bank of Japan forecasts .3-.4% economic contraction in Q1, 2012

Corporate tribalism echoes a leadership style from ancient civilization

Image attribution: Kabuto 7; CC BY-SA 3.0

Corporate tribalism expresses the same nepotistic fear characteristic of political tribalism from times passed. Tribalism, with its chiefs, or in the case of corporations, chief executives, is an enclave of beliefs and practices governed by a paternalistic style hierarchy.

This type of management style was used in ancient Babylon, and many cultures thereafter as a way of coordinating society. It gave special rights, and even divine attribution to the leaders of those societies.

That was before people realized they could cooperate at an administrative level for the good of the whole without the tragedy of the commons setting in. Eventually, tribalism became suppressed in some cultures, and took a lower standing within society. It became demoted to the world of business leadership, at least in Western cultures that is.

Now, our businesses are run like tribes, and the same attributes of ancient tribes run rampant in corporations, for better or for worse. Fear of outsiders, hiring from within the tribe, competition with other tribes seeking the same thing, and use of similar resources in the same environment.

Financial News 1/23/2012

• WP: NY Judge challenges flat SEC settlements for shortchanging investors 
• Bloomberg: Paypal to allow in-store payments in show down with creditors
• CNN Money: North Las Vegas among worst hit by foreclosures
• Reuters: Mitt Romney to release tax returns showing how he pays 15%
• MW: Taxes are lowered via some insolvency and bankruptcy filings
• Telegraph: Interest rates and maturity dates delay Greek debt negotiations
• Fox Business: French reconsider implementing stock market tax

How Football Teams Lose Money...

This is why the San Francisco 49rs lost the NFC Championship.....That and a second failed punt return in overtime and not enough running game.

 

 This missed field goal is why the Baltimore Ravens didn't have a shot at the AFC Championship.

Financial News 01/20/2012

• PRWeb: NFEC issues fake credit card to teach bad experience
• BLS: U.S. inflation for 2011 was 3 percent per CPI
• CFPB: Payday lenders under scrutiny, consumer 'stories' solicited
• Rabodirect: Australian bank offers savings rate as high as 5.6% 
• Google: Google's Q4 revenue up to $10.58 billion, 4Q earnings $2.71 billion
• Reuters: General Motors regains title of World's #1 auto manufacturer
• HSBC: Q4 2011 EMI up .2% to 52.2, China and India PMIs decline
• Telegraph: Portuguese economy in Grecian debt spiral

Financial News 01/19/2012

• WSJ: $19 billion+ robo-signing settlement could lower amounts due 
• DOL: 352,000 jobless claims were filed for the week ending 01/13/12
• GigaOm: AT&T to increase rates on Smart phone plans
• CNN Money: Oil price pushing six month high, around $101-102/brl
• IMF: Crisis response inadequate. Fiscal firewall and joint policy needed
• Irish Times: Greek debt negotiations attempt to avoid disorderly default
• Reuters: Fitch reviewing Euro credit ratings for possible downgrade

Predicting the Stock Market's Direction In 2012

Predicting the stock market's direction is no easy task, even for the best money managers on the planet. Peter Lynch recommends picking good companies and not trying to predict market direction. That does not mean it is not done, and Ken Fisher's Stock Market Advantage demonstrates why with reports on multiple investment group forecasts. 

Some of the results are surprising. For example the Bespoke Investment Group forecasts a 100 percent rise in the Standard & Poor's 500 Index in 2012. It is a surprise given dire economic news coming out of Europe, a slowing China, out of control U.S. national debt,  and a recent World Bank drop in global GDP expectation. These are evidently not of immediate concern to the S&P Index.

Jeremy Grantham echoes a more realistic sentiment in the GMO, LLC 12/2011 quarterly letter.  In it he recommends bias to 'safety' and investment in high-quality U.S. stocks with normal 'weighting' in global equities. In other words, pick strong companies that have investments outside the United States. Grantham also advises against long-term bonds, presumably U.S. Treasuries with low yields and recommends long-term accumulation of ground resources such as potash, and phosphorous which according to the Grantham Foundation for the Protection of the Environment will be scarce within 5-10 decades.

So far in 2012, U.S. markets have rallied considerably in a short-period of time. The San Francisco Chronicle quoting Bloomberg news reported today that the S&P 500 has already rallied 4 percent. That leaves 4.436 percent for the rest of the year after adjusting for inflation per Money Chimp if it's an average year. Grantham attributes this type of market movement to a combination of 'scarily' high-profit margins, low inflation and asset bubbles nursed by Federal Reserve monetary policy, but does not see it lasting indefinitely.  Moreover, Grantham sees a potential overreaction of the S&P 500 Index to as low as 800 points; a reflection of 1970's era market conditions hence, 'no market for young men'. 

Financial News 01/18/2012

• Reuters: Treasury uses pension fund money to avoid debt ceiling
• CNBC: $9.5 billion removed from equity funds in week ending 01/04/12
• BLS: Producer prices for finished goods declined .1% in December
• ABC: Occupy Syracuse campers given 24 hour eviction notice
• World Bank: 2012 projected global growth 2.5%
• MW: Total 2011 FDI into China was $116 billion. 2012 German GDP .7%
• CT: Chinese new home prices declined for 3rd consecutive month

Why Businesses Do and Do Not Initiate Employee Share Programs

Image attribution: Renjith Krishnan. Standard royalty free license

If a business issues one of several possible employee stock ownership programs it is usually for the benefit of the corporation as much, if not more than the employees. These plans are implemented for accounting, managerial and operational purposes aimed at boosting performance, improving financial statements or making the management of human resources more sound.

Complete article link: http://www.helium.com/items/2281311-benefits-and-disadvantages-of-employee-stock-options-and-share-ownership

Financial News 01/17/2011

Asian and European stock markets rallied on news of mass-credit downgrades and a slowing Chinese economy. The reason, downgrades were priced in and the Chinese GDP is slowing down less than expected. That may sound like tosh as estimates are not necessarily as relevant as trends i.e. growth or slow-down, increase in revenue and earnings or growing profit via cost cutting in quarterly revenue declines. If momentum has anything to do with it, rate of change and the relative strength indicator on the DJI both have declining readings which could indicate a rally slowdown.

• CBS: Last day for free financial advice from Kiplinger and NAPFA
• CNN: Gasoline could reach $5.00 per gallon in some locales
• Occupy: Occupy movement to compound on Capitol Hill today
• Reuters: EFSF downgraded by Standard & Poor's
• Zero Hedge: ECB may boost LTRO to €1 trillion in near future
• Bloomberg: European banks to lower dividends to raise capital
• CNBC: European Hedge funds warn of cooling Chinese economy

Financial News 01/16/2012

• Bloomberg: Alabama, Alaska and Arizona have the lowest tax revenue
• NYT: Brokerage firms offer alternative solutions to lower worth clients
• SFGate: Investors removed $85 billion from stock funds in 2011
• Reuters: As middle class shrinks, so does the economy
• S&P: 16 Eurozone nations have credit ratings downgraded by S&P
• MW: Decline in Chinese reserves and political switch brew concerns

Financial News 01/13/2012

• BEA: U.S. trade deficit up $4.5 billion to $47.8 billion in November
• NY Daily News: Holiday sales were ho-hum even with price reductions
• CNBC: Banks claim they are tight on lending due to regulation
• MarketWatch: Better disclosure of retirement plan fees expected in 2012
• Bloomberg: EU embargo of Iranian oil could take six months
• Reuters: Greek economy cannot help itself without loans or debt reduction

How technical analysis of stock prices works

Image attribution: StocksDocs. CC BY S.A.-3.0

Technical analysis in stock trading refers to the evaluation of stock price changes over time. These changes are measured and plotted using formulas, charts and graphs and assessed in terms of patterns, and strength of stock price movement. A number of basic technical tools, and techniques are used to help technical analysts or chartists assess if specific indicators have occurred.

After a technical indicator has occurred, a confirmation of that indicator may follow using another technical analysis metric. Technical analysis is not an exact science, and generally shouldn't be considered as always being reliable. Rather basic technical analysis is sometimes used in stock trading to assist in substantiating or validating other methods of stock analysis.

• Moving averages

Moving averages are measured in days, usually up to 200. When longer-term moving averages have been moved through by stock prices, it sometimes indicates a significant price movement. Sometimes stock price support and resistance are formed near moving averages, and when these price levels are significantly broken it can mean a possible price momentum trend. In other words, moving averages are at times used as pivot points where a stock may have a pattern of rebounding upward or downward.  

• Candlestick charting

Candlestick charting is a form of technical analysis that began in East Asia. In this type of analysis price movements are represented by black or white candlesticks with lines at the top and bottom. Sometimes colors such as green or red replace the black and white in candlesticks. The color, length and positioning of these candles are placed on a chart and scaled in terms of time and stock price . The technical analysis of these charts will then interpret the candles based on past patterns of similar candle positioning.

• Oscillators

Oscillators are used to determine upper and lower limits of price movements. Examples of oscillators are the Relative Strength Index (RSI), and the Rate of Change (ROC) indicators. These basic stock technical analysis tools plot values on a scale between 0-100 using mathematical formulas. When certain value levels are reached, the oscillators are sometimes thought to show an increased probability of a price being close to a high or low.

• Trading levels

Trading levels constitute the amount of stock trading that takes place during a specific period of time and is another widely used basic aspect of technical analysis in stock trading. Trading levels are measured using volume and when it ncreases it can mean a growing momentum in the movement of a trend may be occurring or about to occur. Volume can also indicate overall market participation. For example, during holidays, volume can be quite low due to the absence of investing activity on those days in holiday when the stock market is open.

• Line graphs

Line graphs are also used in basic technical analysis of the stock market. When stock prices are plotted onto line graphs over time, the movement of that price can be analyzed for patterns in a similar way to candlestick charting. For example, a stock price line graph may create a pattern called 'head and shoulders', which literally takes the shape of a left and right shoulder with a head in the middle. If patterns like this become evident, stock prices sometimes follow similar movements to previous occurrences when a similar pattern was observed in that or other financial securities' line graphs.

Research Distinguishes Technology Shopping Habits of Males and Females

 Image attribution: Stuart Miles. Standard royalty free license.

Market psychology and consumer behavior may want to step up their advertising to women if recent data about how women buy more technology than men is true. According to research referenced by Mashable, women are more likely to purchase cell phones, lap tops and tablets.

Complete article link: http://www.helium.com/items/2279403-research-shows-women-buy-more-technological-gadgets

Financial News 01/12/2012

• Reuters: College savings plans are not necessarily safe ways to invest
• Seattle Times: Digital accounts pose new concerns for estate planning
• DOL:  399,000 jobless claims were filed for the week ending 01/07/ 2012
• CNBC: Emerging markets better equipped to handle economic slowdown
• Fed: U.S. economic activity expanded in November and December 2011
• Census: December retail sales $400.6 billion, up .1 percent
• BBC: Chinese inflation was 4.1% in December

Income taxes 101

Image attribution: Arvind Balaraman. Standard royalty free license

 Income is categorized into approximately 24 types according to the Internal Revenue Service (IRS). Although there are several different types of income, they all can be labeled as taxable income. However, not all kinds of income are taxable at the same rate. Tax rates can also change between tax years due to changes in tax law that can affect how tax is calculated, when tax is calculated and what is or isn’t tax protected.

• Wages and salaries

A common type of taxable income described by the IRS is wages and salaries. This income is reported on the Form W2 that is sent to income recipients near the beginning of tax filing season. Even though this is one type of income, it is taxed at differing rates determined by total taxable income; for the 2010 tax year, these tax rates can range from around 10 percent to 39 percent. Total wages and salaries is not usually the final amount of income that is considered taxable because it doesn’t take into account exemptions, deductions and credits.

• Capital gains

Tax on capital gains varies on whether those capital gains are offset by capital losses and if the capital gains are acquired through a tax protected financial vehicle such as  a Roth IRA. According to the Tax Foundation, the maximum capital gains tax for the 2010 tax year is 35 percent. This amount applies only to short-term capital gains and not long-term capital gains which have a 15 percent maximum rate for the same year.

• Interest and dividends

People also often receive Form 1099s that provide a record of other income such as income from interest and dividends. Tax on dividends can vary and may not be taxable at the same rate as normal income. These types of dividends are called qualified dividends and must meet certain requirements to qualify for the lower tax rate. These qualifications can be reviewed at the University of Connecticut Business School. Interest on financial securities is often taxable unless those financial instruments are non-taxable as is the case with some types of municipal bonds.

• Social Security

Income from social security entitlements may or may not be taxable depending on the individual circumstances. The IRS states persons whose only income for a given tax year is social security may not even need to file a tax return. Income from social security is recorded on Form SSA-1099 and is reported on Form 1040. If social security is taxable, it is usually taxed at the same rate as income from wages and salaries or the standard tax rate that applies to the given taxable income amount.

• Retirement income

If income is received from retirement accounts such as Individual Retirement Accounts (IRAs),and 401(k)s, whether or not that income is taxable can also depend on the individual situation. For example, if the income is directly transferred to another retirement plan, i.e. not received but redirected there’s a good chance it may not be taxable. However, if the income is paid to the retiree, and is from a tax deferred retirement account such as a traditional IRA, then the income is more likely to be taxable.

Several additional types of income tax exist and it is always a good idea to verify tax questions and information with the IRS at 1-800-829-1040, or a qualified tax professional before sending a completed tax forms to the IRS for processing. This is because there may be overlooked tax rules, better ways to reduce tax and possible errors in the tax documents to be sent to the IRS.

Why Brazil's Economy is Growing Well

 Image source:João Felipe C.S. Public domain

The Brazilian economy is firing on multiple cylinders with more pros in its favor than cons to its disadvantage. Growth in multiple sectors of the economy has been fueled by government openness to investment in addition to development of the country's bounty of human and natural resources. 

Complete article link: http://www.helium.com/items/2279041-brazils-booming-economy

Financial News 1/11/2012

• Reuters: New generation of investors avoid the stock market
• MarketWatch: IRS offers amnesty to some tax evaders
• C.U.T: Suze Orman diversifies profession and issues own debit card
• TechCrunch: Payoff.com issues personal finance badge reward system
• Bloomberg: Germany also facing recessionary economic pressure
• WSJ: Chinese trade surplus shrank on lower exports

How to create a successful budget

 Image attribution: Stuart Miles. Standard royalty free license

A successful budget grows wealth and manages debt within an organized framework that easily manipulates and apportions money for maximum financial benefit. The traits of a budget are what help make it successful by providing the basis with which the budget can operate and assist with appropriately managing the budgeter’s life.

Capitalize

No budget can work without money to budget so a budget must be capitalized to be successful. Examples of sources for capitalizing a budget include income, capital gains, and interest earned from assets. Once a budget has been capitalized, the financial parameters within which the budget can operate are established.

Prioritize

Another trait of a successful budget is they are often prioritized. In other words, some expenditures and allocation of money may be more important than others. To determine which budget allotments should take priority, consider the affect on basic needs, cost of debt, reduction of debt, and amount of savings. For instance, a good budget accounts for basic short-term needs such as food while simultaneously preparing for longer term financial horizons.

Systematize

Systematization of a budget is a similar trait to prioritization except its focus is more on the functionality of the budget. For example, a successful budget might distribute money across a number of categorized goals such as retirement planning, emergency savings, high interest debt and so on.

Optimize

Optimization of money is a key trait of a successful budget because it allows that money to go as far as it can go. For example, if debt can be paid off within six months, and the money used to pay that debt is then re-allocated to savings for another six months will there be more savings over a course of one year than if an equal amount of debt payments and savings contributions had been made?

Accessorize 

A successful budget may also be accessorized, not necessarily by expensive financial software, but rather with useful budgeting techniques. Simple mathematical analysis of a budget is one such accessory. To illustrate, mathematical analysis is a useful if not essential accessory because it allows the budgeter to determine if one use of money has a more advantageous affect on net worth than another.

Since finances and people’s lives are diverse, a budget can vary from simple to complex based on the financial needs of the individual or household. For example, an overly complicated budget may be simplified to better meet the objectives and requirements of a straightforward financial plan. Moreover, successful traits of budgets reflect tailored financial allocations that meet specific needs, and goals using comfortable and suitable methods.

Financial News 1/10/2012

• Fed: U.S. consumer credit rose to $20.37 billion in November, up 9.9%
• Fitch: U.S. corporations positioned well, Euro debt faces downgrades
• Alcoa: 4th quarter 2011 earnings loss kicks off earnings season
• St. Louis Fed: U.S. personal savings rate 3.5% for November, a 3 yr low
• Reuters: Home prices declined for 4th straight month
• Bloomberg: Chinese import growth slowed to a two year low

Financial News 01/09/2012: Economic Can Kicking Getting Trite

Every one to three months, national and world leaders meet to arrive at new quick fixes to tired economic problems. The United States, Greece, and other Eurozone nations have repeatedly used economic band aids such as the two-month payroll tax cut extensions in the U.S., and the long-term refinancing operations by the European Central Bank. Recently, Greece is facing new bond-swap deals to help it avoid debt default per Reuters. In the past Greece has avoided default through legislative austerity measures.

The problems with many of these financing deals, austerity measures, and government bailouts is they do not address the core issues of government gridlock, deficit spending, high national debt, poor economic performance and overall solvency. Real solutions are needed for real problems, and the existing solutions highlight how ill-equipped both the U.S. and European nations are to effectively handle current economic issues.

• AAA: Current average gas price higher than 1 year ago and rising
• WP: 'Carried interest' tax break allows income to be treated as capital gains
• ET:  U.S. Banks facing lower 4th quarter earnings
• CB: Global consumers to spend over $1 trillion in electronics in 2012
• Bloomberg: Hungarian 10-year notes near 10% yield
• Reuters: Chinese 4th quarter inflation forecasted at 4%, GDP 8.7%

Financial News: 12/08/2012

• Chicago Tribune: President encourages businesses to hire in the U.S.
• Bloomberg: New quantitative easing from Federal Reserve Bank  unlikely
• Reuters: 15% of Americans plan to work to age 70 per the EBRI
• Economic Times: New earnings season results may favor small-caps
• Occupy: Occupy Portland attempts redirection of corporate objectives
• Marketwatch: Chinese economy one sided,  domestic market undeveloped

Weekend Activity: House Hunting

Looking at van down by the river

Bed, bath and beyond the trash dumpster

 I can afford this foyer

If I make any less money this will be my new house.

Financial News 12/07/2012: Lower Euro Boosts The Dollar

A lower valued Euro currency has in recent days corresponded to a rise in the value of the dollar per the dollar index. With a rise in the dollar, oil price increases are curtailed as it is priced in dollars. Higher dollar valuations also mean lower treasury yields have more value which makes U.S. foreign debt more expensive in terms of real worth. 

A higher dollar is good for Americans in the sense that having a higher valued dollar also prevents inflation and allows income to buy more. However, a low dollar valuation also makes debt cheaper in the sense that the value of debt declines, and the national debt is over $14 trillion dollars. In this sense the goals of the government and the American people differ in some ways.

Maintaining a strong economy is achieved by actions that give a 'country' rather than a 'nation' a stronger long-term position in the global marketplace. In theory, a strong country means the needs of the nation can then be better met, but that is neither a guarantee nor a requirement in any clearly defined way. In a way, the economic needs of the nation are not necessarily optimally calibrated with the expectations for the country's economy.

• CBS: President Obama bypasses senate to appoint consumer affairs chief
• Reuters: Federal reserve governor advocates bank penalties
• Bloomberg: S&P has best annual start since 2006
• Moody's: Illinois bond rating downgraded to A2
• Business Insider: Long-term stock market cycle implies more volatility
• Washington Post: Euro currency value sliding

.26 Cents Per Ale is Possible

The following eight Weyerbacher ales were purchased for exactly $2.08. Each four pack had been marked down to $3.99 and had a $3.00 coupon attached to it. The large blank space on the receipt shows where the retailer took pause to recheck the math from disbelief. The coupons deductions and final price can be seen in the following photos.

This ale achieved a score of 85/100 on Beer Advocate from 203 reviews so it is a quality beverage.

The date on the bottles was 11/30/2011 so they were recently expired, however the tasters were pleased with the flavor. Brown bottles preserve beverage quality better than green and white bottles.

42 States Face 2012 Budget Deficits Per The CBPP

The majority of U.S. states continue to face financial pressure and deficit spending according to the Center for Budget and Policy Priorities. California alone has a projected budget deficit of $9.2 billion per Governor's Journal. The result of deficit spending like this reflects the U.S. economy is at a crossroads of sorts, and one where taxes and budget cuts are more real possibilities.

Forecasts of state budget deficits differ. EconMatters, a team of financial research analysts state at least 17 states face budget shortfalls in the 2012 fiscal year. The total 2012 state deficits is thought to reach $41 billion per EconMatters. The Federal government is facing even worse debt problems. The Department of the Treasury reported a 2011 deficit of $1.299 trillion and projects a 2012 deficit of $1.645 trillion per its 2012 budget.

The effect of government debt on the economy will be lack of, or lower stimulus which contributes and is included in gross domestic product calculations. This means corporations will have to generate growth. However, with a shrinking work force per the Department of Labor chart below, increasing entitlement burdens due to more retirees drawing from social security, possible contagion from the Eurozone debt crisis, and slowing growth in China and India, this growth will be challenged.

Department of Labor: Labor participation rate

• BLS: U-3 jobless rate for December 8.5%; U-6 jobless rate 15.2% 
• Ron Paul: U.S. deploying troops to Israel for possible war with Iran
• Blackrock: 2012 will bring volatility, inflation, and economic divergence
• Bloomberg: Italy presses Vatican for taxes
• Marketwatch: Italian 10-year bond yields rise above 7% again
• CNN Money: French credit rating drop near inevitability per Chief dealer

When Buying a New Car is a Good Idea

Image source: Jagvar, C.C. BY-SA 3.0

Buying a new car is an important financial decision. If a new car is a necessity due to a life change or breakdown of older car, several reasons exist to purchase a new one including ways to lower auto insurance. Taking these reasons into account can help improve the purchase and optimize the decision to buy.

Complete article link: http://www.helium.com/items/2276621-why-purchase-a-new-car

Financial News 01/05/2012: MF Global Rehypothecation Is a Warning to Investors

Rehypothecation is a legal practice that enabled MF Global to use clients money to purchase European debt instruments that lost money before clients' money could be returned. Since regulations did not require the corporation to hold enough money to account for deposits, the rehypothecated money essentially did not exist and was used to leverage bad debt purchases per Reuters.

Investors are not always aware of how their brokerage firms utilize their assets. Without clear information into how well a financial institution is performing via comprehensive income statements and detailed evaluation of terms of service, a contractual risk is added to one's financial planning objectives via rehypothecation. This increases overall risk on top of other financial hazards such as inflation, investment risk, opportunity cost etc.

• DOL: 372,000 jobless claims were filed the week ending 12/31/12
• Chicago Tribune: Ethanol subsidy cancellation likely to increase gas costs
• ADP: 325,000 seasonally adjusted jobs were created in November
• Commerce Department via Census: November factory orders rose 1.8%
• Business Insider: Kodak (EK) plans for debt restructuring via bankruptcy
• Reuters: Europe in favor of banning Iranian oil as oil rises above $100/brl
• Bloomberg: French 10 year bond yields rose to 3.19% in auction
• Telegraph: Iran intensifying defensive posturing over Straight of Hormuz
• Time: Pentagon to cut $450 billion in military spending

Financial News 01/04/2012: Eurozone LTRO Inadequate

The European  Long-Term Refinancing Operation is inadequate according to analysis by the Wall Street Journal. This is because the borrowing of money via the European Central Bank's lending operation does not require or guaranty purchase of European Sovreign Debt. In other words, since European bonds represent a certain amount of risk, particularly in the cases of Spain, Italy, Portugal and Greece, banks may not want to overload their balance sheets with too much to avoid higher risk.

Since Eurozone banks are experiencing liquidity problems due to risk exposure, the problem is self-perpetuating. Moreover, because of banks' holdings of assets such as Greek bonds, the riskiness of their assets caused borrowers to hold back or increase cost causing refinancing issues. The ECB responded with the LTRO and other measures to help relieve this, however, buying more high risk debt is definitely a gamble going into 2012. In order for the ECB Open Market Operations to be successful, similar measures used by the Federal Reserve Bank might be more effective as it directly, rather than indirectly addresses the issue.

• Fed: Goals of open market operations: price stability and sustainable output
• PR Newswire: 4th quarter 2011 M&A activity declined from 3rd quarter
• NYT: U.S. Office of Financial Research could be leaderless for months
• Reuters via CNBC: Downpayment costs caused mortgage decline in 2011 
• The Economist: European banks borrow near €500 billion via LTRO
• ISM: December Purchasing Managers Index rose to 53.9%

Financial News 01/03/2012: IMF SDRs Dispurse Debt, Therefore Lower Debt Management Risk

According to the Graziado Business Review, since 1942 the stock market has bottomed an average of 1.87 years into a Presidential cycle. Moreover, the average bull market is 3.8 years per InvesTech Research via the Big Picture. Since the bull market started in 2009, 3.8 years would put the market bottom at the first year of the next Presidential cycle sometime in 2013.

Economically, the U.S. has stabilized, but faces many challenges. The auto industry continues to improve if sales are any indicator.  The value of the dollar has increased recently per the Dollar Index, possibly contributing to the decline in the price of gold below $1,600 per Troy ounce and a stabilizing of sweet crude oil prices. Even though unemployment has declined, the workforce has shrunk. Yet small businesses borrowing is up despite higher consumer revolving credit.

Conditions around the World seem volatile. With the Eurozone heading into a likely contraction with the exception of Germany per Bloomberg, the Euro currency may lower further. However, the effectiveness of international banking via Special Drawing Rights may avert this. In effect, by developing debt this way, it spreads responsibility for it across a larger range of financial institutions and entities, but doesn't lower it. The Market Oracle considers SDRs to be a possible replacement for the Dollar in International Trade settlements.

• NYT: 2012 consumer spending to be tepid per ITG Investment Research
• Newsday: Small-business borrowing has reached February 2008 levels 
• AP via Yahoo Finance: Auto industry reaching healthy sales levels
• RT: CIA uses drug money to fund operations per Ron Paul
• Economic Times: Eurozone manufacturing declines for 5th month in a row
• UK Telegraph: HSBC Chinese December PMI shows contraction at 48.7
• EITB: Spain's finance minister states 2011 deficit spending may top 8%